Correlation Between ZincX Resources and Gratomic

Can any of the company-specific risk be diversified away by investing in both ZincX Resources and Gratomic at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining ZincX Resources and Gratomic into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ZincX Resources Corp and Gratomic, you can compare the effects of market volatilities on ZincX Resources and Gratomic and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in ZincX Resources with a short position of Gratomic. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZincX Resources and Gratomic.

Diversification Opportunities for ZincX Resources and Gratomic

-0.12

Correlation Coefficient

ZincX Resources  Gratomic

Good diversification

The 3 months correlation between ZincX and Gratomic is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding ZincX Resources Corp and Gratomic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gratomic and ZincX Resources is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on ZincX Resources Corp are associated (or correlated) with Gratomic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gratomic has no effect on the direction of ZincX Resources i.e., ZincX Resources and Gratomic go up and down completely randomly.

Pair Corralation between ZincX Resources and Gratomic

Assuming the 90 days horizon ZincX Resources Corp is expected to under-perform the Gratomic. But the pink sheet apears to be less risky and, when comparing its historical volatility, ZincX Resources Corp is 2.46 times less risky than Gratomic. The pink sheet trades about -0.06 of its potential returns per unit of risk. The Gratomic is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest  5.12  in Gratomic on September 4, 2024 and sell it today you would lose (1.44) from holding Gratomic or give up 28.13% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

ZincX Resources Corp  vs.  Gratomic

ZincX Resources Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ZincX Resources Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Gratomic

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Gratomic has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's essential indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with ZincX Resources and Gratomic

The main advantage of trading using opposite ZincX Resources and Gratomic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZincX Resources position performs unexpectedly, Gratomic can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Gratomic will offset losses from the drop in Gratomic's long position.

The idea behind ZincX Resources Corp and Gratomic pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.